Question: 5 Required: You manage an equity fund with an expected risk premium of 11.4% and a standard deviation of 28%. The rate on Treasury bills

5
5 Required: You manage an equity fund with an expected risk premium

Required: You manage an equity fund with an expected risk premium of 11.4% and a standard deviation of 28%. The rate on Treasury bills is 5.2%. Your client chooses to invest $50,000 of her portfolio in your equity fund and $150,000 in a T-bill money market fund. What is the reward-to-yolatility (Sharpe) ratio for the equity fund? (Round your answer to 4 decimal places.)

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